Mandatory code for doctors to ensure generics get precedence over branded drugs

New Delhi: In a move to give teeth to the PM's announcement that doctors will need to prescribe generic drugs rather than expensive branded ones, the Centre will come out with a mandatory code on marketing practices to ensure doctors and pharmacists follow the rule.

The code is aimed at making the drug supply chain involving pharmaceutical companies, distributors, retailers and doctors accountable to the proposed marketing code which has been given in-principle nod by the department of pharmaceuticals. The code is being vetted by the law ministry.

Violation of the code will carry penalties ranging from a warning to licence cancellation depending on the seriousness of the offence. The Centre proposes that multiple laws can be invoked to punish offenders.

The Uniform Code for Pharmaceutical Marketing Practices will be made legally binding through an executive order. "Once the law ministry approves the code, there will be a final round of public comments on the draft before issuance of the gazette notification," DoP secretary J P Prakash told TOI.

The decision will be an important step as so far the marketing code is "voluntary" and applies only to the pharma industry. Once the executive order is issued by DoP, the code will be binding and its violation will attract punishment and penalty under the Essential Commodities Act, the Indian Medical Council Act as well as Drugs & Cosmetics Act.

DoP has already consulted health ministry and Medical Council of India on the decision.

Modi has on Monday said the government is working to bring in a legal framework under which doctors will have to prescribe low cost generic medicines to patients.

The PM's statement raised concerns among many about how this could be done without tapping other parts of the supply chain including pharmacists and distributors, who often push drugs with higher margins.

However, senior officials in the government suggested the PM's statement was supported by a multi-prongned strategy already in the works under different ministries and departments and changes to relevant laws.

Apart from DoP, the health ministry, the Central drug regulator - Drugs Controller General of India, , the National Pharmaceutical Pricing Authority (NPPA) and the Medical Council of India have been tasked to strengthen different laws and regulations to ensure consumers can be empowered to make informed choice.

The NPPA is also trying to cap trade margins for not only branded generics but also "generic generic" drugs. The latter are drugs being sold only as the chemical formulation that are not currently capped.

Similarly, health ministry has asked MCI to enforce the order it issued in October and make it mandatory for doctors under the law to write the generic name of drugs in legible handwriting. "We have asked MCI to ensure that doctors who are not doing so are punished under the law,"a health ministry official said, adding it has also written to state authorities to enforce it by proper monitoring.

It is also trying to ensure consumers can distinguish between generic names and branded names by asking companies to conspicuously mention generic name on packs. While earlier most of the attempts were in the form of advisories and guidelines, with new provisions any violation will be punishable with hefty penalties and even amount to cancellation of licences for doctors, manufacturers and pharmacists.

Apart from the supply chain, the DCGI has also issued orders to state drug regulators to grant manufacturing licences to companies only based on generic names of their products, instead of brands. This is being seen by many as an attempt to promote generic drugs.

Estimates show more than 70% of the over Rs 1 lakh crore domestic pharmaceutical market is dominated by branded generics, whereas 9% is patented drugs.

Despite a stringent price control, big pharma companies manage to spend exorbitantly on marketing and branding of their drugs. Since advertisement of prescription medicines are not allowed in India, companies or medical representatives push their products through doctors, chemists and distributors in lieu of freebies, junkets and incentives. While generic medicines are good quality low cost drugs with equal efficacy as that of branded drugs, in the absence of proper knowledge consumers often tend to go by what doctors and chemists decide for them.

The government's move assumes significance as medicines account for 70-75% of a household's out of pocket expenditure on health.